Mobile chip giant sees smartphone surprises ahead

Jul 26, 2013

Leading mobile phone chip maker Qualcomm said Thursday that the next generation of smartphones will take another stride forward as the company reported robust quarterly earnings.

"We still think the next smartphone is going to surprise you with the things it can do," Qualcomm director of CPU product management Travis Lanier told AFP. "There is a way to go in innovation."

Demand for Snapdragon chips, which combine computer processing and graphics capabilities in a compact platform for powering devices, helped the California company make a profit of $1.58 billion on revenue of $6.52 billion in the quarter that ended on June 30.

"We delivered another strong quarter as our Qualcomm Snapdragon solutions were prominent in a broad set of flagship smartphones, and 3G/4G device average selling prices were stronger than expected," said Qualcomm chief executive Paul Jacobs.

"We see expanding opportunities for growth of 3G/4G devices around the globe, driven by the strong pace of innovation in the industry."

Profit was up 21 percent from the same quarter last year, while revenue increased 35 percent.

The "system-on-a-chip" design of Snapdragon allows for smartphones or tablets to be designed with features such as playback of ultra high-definition video or surround-sound in headsets plugged into devices.

More than a thousand products are shipping with Snapdragon chips, and hundreds more are in the pipeline, according to Qualcomm executives.

The chips are also being built into coming tablets, including the Nexus 7 unveiled by Google on Wednesday.

Rather than the mobile gadget market slowing as it matures, Qualcomm executives saw it as accelerating.

"There are still plenty of people who don't have a smartphone," Lanier said.

"There is a lot more growth to be seen; and I expect tablets to take off."

A 'Quantified Self' movement driven by wearable computers such as wristbands or pendants with sensors that relay information to increasingly sophisticated smartphones or tablets is weaving the devices even deeper into lives.

"We call it the digital sixth sense," Qualcomm marketing executive Tim McDonough.

"The is shifting to something that is always paying attention to what is going on around you; a device going from passive to sentient."

McDonough predicted that new with innovative capabilities will hit the market in coming months as manufacturers get products in place for the year-end holiday shopping season.

"People are going to do things that we never would have thought or, and we love that," McDonough said of mobile device innovators.

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